Canadian telecom firm Telus's Q2 revenue up 2%, sells stake in tower firm for C$1.26 bln

Overview

• Telus Q2 2025 operating revenue rises 2% yr/yr to C$5.1 bln

• Adjusted EBITDA grows 1%, reflecting cost reduction and subscriber growth

• Co sells 49.9% stake in newly formed wireless tower infrastructure operator Terrion for C$1.26 bln to reduce leverage

Outlook

• Telus reaffirms 2025 revenue growth target of 2-4% for TTech

• Company expects 2025 adjusted EBITDA growth of 3-5% for TTech

• Telus projects $2.5 bln capital expenditures excluding real estate

• Telus projects free cash flow of about C$2.15 bln for 2025

• Company targets 3.55-times net debt to EBITDA ratio by end of 2025

Result Drivers

• CUSTOMER GROWTH - Telus added 198,000 mobile and fixed customers, driven by demand for bundled services and PureFibre expansion

• TELUS HEALTH - Segment achieved 16% revenue growth and 29% adjusted EBITDA growth, fueled by strategic investments and synergy optimization

• COST REDUCTION - Adjusted EBITDA increased by 1%, supported by cost reduction efforts and subscriber growth

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 7 "strong buy" or "buy", 10 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the integrated telecommunications services peer group is "buy."

• Wall Street's median 12-month price target for Telus Corp is C$23.00, about 3% above its July 31 closing price of C$22.32

• The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 20 three months ago

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